"Small is Beautiful": Alternative Dreams, Traditional Industries, and the Future

Hans Weinberger

For a long period of time, the steel industry in the world seemed to follow a trajectory of production that fostered larger and larger production units. The rational was easy to grasp. By investing in larger production units with high capacity, the unit production price could be reduced. It is cheaper to invest in one large production unit that produce a specific quantity, than in two smaller one producing the same tonnage. Especially the Japanese investments in very large production units seemed to indicate the road to the future. A prerequisite for the trajectory is a rather stable market, both in volume and demand profile. During a period from the end of the Second World War, through the 1960s, the demand of steel was growing with a rather stable pace, but this all changed in the 1970s due to the global recession following the oil crisis.
The recession partly transformed the steel industry. Alongside the large production units, a number of so-called mini-mills grow up. These mini-mills were small in size, but combined modern flexible production technology with specialized, customertailored, steel products. Investments in a mini-mill did not reduce the production unit cost, but limited the total investment, thus reducing the overall risk in a market situation that did no longer promise growing demand.

In a broader perspective, the 1970s also showed a different political and social climate, that put more emphasis on social justice and environmental issues. This was combined with a more general scepticism towards the modern industrial society. The exploding critique of nuclear power is a case in point, which both focused on technocratic and environmental aspects of the technology.

The paper will focus on a small utopian project in Sweden during the 1980s, called "Future Ironworks". It was a project financed by the Swedish National Board for Technical Development, and initiated by a visionary professor of metallurgy at the Royal Institute of Technology in Stockholm. The project was meant to function as an illustration for the Swedish steel industry of what could be done by integrating modern production technology with modern democratic management methods, and small scale. It thus tried to show that a different path to the future existed outside the traditional structure of production. Small was not only beautiful, it was also more efficient and profitable. The goals of local democracy, regional attachment, national relevance, and international profitability were all integrated into the project. The project was thus a child of its specific cultural and political context. The paper finally discusses the influences of this project on the Swedish steel-industry.